Fuel Poverty: Poor Families Need More Help, Says Save The Children

Poor families struggling to heat their homes this winter are not getting the help they need from energy suppliers, a charity warned.

The Government's scheme for help with bills currently reaches just 3% of families at risk of fuel poverty, because energy companies have not committed enough funds this year, according to Save the Children.

Some 800,000 of the poorest families qualify for a £120 discount on fuel bills under the Warm Homes Discount scheme, the charity said - but a "huge" funding shortfall means only 25,000 families will get it, it added.

Its No Child Left In The Cold campaign is calling on energy companies and the Government to fill this funding gap, so all families eligible for the fuel discount receive it.

Companies also need to promote the scheme better to low income families, a spokesman said.

Chief executive Justin Forsyth said: "It's unacceptable that 97% of the UK's poorest families who need help heating their homes this winter will get nothing because energy companies have not put up nearly enough money.

"Without this help the choice for parents is stark: cut back on food, get into debt or risk their children's health because they can't afford to keep them warm. The scheme urgently needs millions more from the energy companies, or the cost will be counted in children's futures."

The charity said the scheme grants a rebate to eligible households of £120 in the first year (that is, winter 2011/12), £130 in year two, £135 in year three and £140 in year four on their energy bills.

But it is "fundamentally flawed" because it does not require the energy companies to provide enough funding to support all households on low incomes and at risk of fuel poverty.

"Despite research which shows that the risk of living in fuel poverty is almost the same for low income families as it is for pensioners, the Government has decided that only poorer pensioners will form the 'core group' automatically eligible for support," it said.

"The 'broader group' are eligible for, but will not automatically receive, the discount because payment is at the discretion of each energy company.

"In effect, because most energy suppliers have a cash-limited amount to offer the broader group, the Warm Home Discount will operate on a first come, first served basis."

Suppliers are required to spend annually, in aggregate, £250 million in 2011/12 rising to £310 million in 2014/15, and the Government estimates the scheme will be worth £1.1 billion from 2011 to 2015, helping around two million households.

"A large proportion of the funding will be taken up by those in the core group (namely, those in receipt of pension credit)," the charity said.

"To ensure all families eligible for Cold Weather Payments (predominantly made up of low-income families with children under five or a disabled child) receive the Warm Home Discount this year, the amount of money available would need to increase by almost £100 million.

"It is not clear how the encouraging commitments each energy company has outlined for their broader group (that is, the inclusion of low-income families with children) can be delivered without them committing the extra funding required.

"Worryingly, the energy companies are only required to spend £3 million on broader-group customers in the first year of the scheme.

"This means only 25,000 households will receive the £120 rebate this year. However, there is nothing stopping the energy companies voluntarily contributing extra funding so that they can provide more households with vital support.

"We're calling on the energy companies to guarantee that the Warm Home Discount will be paid to all families eligible for Cold Weather Payments and to find additional funding for this if required.

"We will be monitoring closely the energy companies' willingness to invest extra money in the Warm Home Discount. If they are not forthcoming then the government will need to consider increasing the financial commitment by the energy companies in subsequent years of the scheme."

A poll commissioned by the charity showed that many of the parents surveyed were considering choosing between paying for food or fuel this winter.

Nearly a third of those polled said they would not be able to afford their winter energy bills, and almost half (45%) said they were considering cutting back on food in order to pay their energy bill.

Only 9% of parents on the lowest incomes in this survey said they had heard of, and were planning to apply for, the Warm Homes Discount.

:: YouGov surveyed 1,016 parents of children under 16, online, between November 21 and 24.